Mortgages and Real Estate

Real estate appears to be rebounding slowly but surely. There’s even a push from government regulators to lower the down payment requirements for new mortgages. New analysis shows few borrowers are granted 3 percent to 5 percent down payment loans on their homes, and those that do have excellent credit. The percentage of people receiving that low rate peaked at 3.4 percent in 1999. It remains to be seen if lenders will be amenable to lowering their down payment requirements.

CLICK HERE to read the article, “Why Offering 3 Percent Down Payment Mortgages Is Not a Return to Lax Lending,” from The Washington Post, Nov. 6, 2014.

According to research by HelloWallet, about 69 percent of Americans currently own a home, and 29 percent do not own but want to. However, home ownership does not always offer the same financial and tax benefits to everyone equally. Approximately half of today’s homeowners could potentially build more wealth by renting and contributing any extra money to properly structured 401(k)s, IRAs or other types of tax-free or tax-deferred retirement income accounts.

In fact, for lower-income households, the tax deductions associated with home ownership do not amount to much more than the standard federal tax deduction — $6,200 for single people and $12,400 for couples who file taxes jointly. A family earning $50,000 a year could generate 50 percent more wealth over the next decade by contributing to their retirement income accounts rather than their homes. Of course, this assumes that all savings that come from not owning a home (which may include anything from property taxes to home repairs) are allocated to a retirement income strategy and not spent on discretionary items. It’s tough for renters to know how much discretionary income they have now that they may not have if they owned a home, as well as what strategies they may be able to utilize in order to help increase their retirement assets.

CLICK HERE to read the view the infographic and download the research paper, “House of Cards: The Misunderstood Consumer Finance of Homeownership,” from HelloWallet, November 2014.

CLICK HERE to read the article, “Why You’re Often Better Off Saving for Retirement than Buying a Home,” from The Washington Post, Nov. 11, 2014.

While the inventory of existing homes on the market remains low, competition for those sales comes from two different directions. First, millennials have benefitted greatly by an improving economy and have achieved 60 percent better job growth than the U.S. overall this year. They represented 37 percent of home shoppers this summer; a number that is expected to rise as the economy improves. The millennial generation’s main competition for homes is the baby boomer generation, many of whom are downsizing and have substantial buying power. These two competing demographics are responsible for the growing demand for smaller, less expensive homes.

CLICK HERE to read the article, “Changing Demographics Impacting Housing Market, Say Realtors,” from National Association of Realtors, Nov. 9, 2014.

CLICK HERE to view the interactive infographic, “Qualifying Income for Metropolitan Areas” from National Association of Realtors, accessed Nov. 9, 2014.

CLICK HERE to view the presentation, “Residential Real Estate Trends and Outlook,” from National Association of Realtors, Nov. 7, 2014.

There are many different ways you can accumulate wealth to help you feel more confident in your financial future. If we can help you explore options that may be appropriate for your situation, please give us a call at 801-990-5055 or visit us at www.bossretirement.com.

Our firm assists retirees and pre-retirees in the creation of retirement strategies utilizing insurance products. Our firm is not permitted to offer, and no statement contained herein shall constitute, tax, legal or accounting advice. Be sure to speak with qualified professionals before making any decisions about your personal situation. Our firm is not affiliated with the U.S. government or any governmental agency.

Advisory services offered through B.O.S.S. Retirement Advisors, a Registered Investment Advisory firm, and offered through Global Financial Private Capital, LLC, an SEC Registered Investment Advisor. Insurance products and services offered through B.O.S.S. Retirement Solutions.

This content is provided for informational purposes only. It is provided by third parties and has been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed. The information is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet the particular needs of an individual’s situation.